Majority shareholders in a corporation have the power to control the majority of common and extraordinary shares, enabling them to issue resolutions that benefit a specific group of shareholders or harm another, without regard for the overall welfare of the corporation
Therefore, the law has granted the right to minority shareholders to either file a direct lawsuit to invalidate this decision or submit a request to the General Investment Authority to temporarily suspend that decision if they own at least 5% of the company’s capital shares, then file a lawsuit to invalidate this decision as long as the following conditions are met by this minority of capital shareholder
The decision must be issued in favor of a specific group of partners or to harm a specific group of partners or to bring special benefit to directors or others without considering the company’s interest.
This partner or these partners must have attended the ordinary or extraordinary general meeting where this decision was issued and demonstrated their objection in the meeting minutes.
Or this partner or these partners did not attend the ordinary or extraordinary general meeting where the decision was issued but had an acceptable excuse.
For more in-depth details, please refer to the comprehensive book on theoretical and practical aspects of company law
Doctor/ Mahmoud Mostafa Abdallah
Doctor/ Ola Mostafa Abdallah